Focus on Funds: Bad News for Bond ETFs and Gold

Gold traders sold in anticipation of Wednesday's Fed announcement, and some bond ETFs got a one-two punch. Stocks, however, cruised.

This transcript has been automatically generated and may not be 100% accurate.

I ... no matter what you're investing in all about ... Jack Otter Editor Barron's dot com here is Brendan Conway right to focus on Funds bought ... at last he been writing recently branded have to do with the markets anticipation of what Ben burn Anqi is can it say ... about interest rates and quantitative easing and so forth but star with gold ... is that market is selling off a bit in anticipation of this meeting ... yet in check you know it seems as though this is printed word tapering rent April referring to ... whether the Fed will go on a pull back its bond buying ... new programs ... to the tube in talking about this for months and yet the market still reaction still trades ... on a price of gold um you know kind of easing a little bit ... ahead of the much awaited FOMC ... minutes ... um ... yes I'd you know I I was a surprise as I would've thought that the price would already reflect all this it doesn't ... so I guess the dying and the key is ... that people buy gold because they fear inflation the fear inflation because they think the Fed is printing money to the Fed's as our ease up on the money printing ... some of the gold for governments for ... the annually other factors out there to read is that ... gold investors gold traders also have to gauge what other gold traders are likely to do since he's really I think has become ... fairly crowded place refuse to be in Shasta ... councils of the bombs obviously if the Fed stopped buying eighty five billion dollars in bonds every month ... then you know you don't have all that money pouring in on your side so the fun markets here ... that you reveal the really interesting thing that I didn't know which is that ... bond the ETF still always self of the same value as the assets they hold up to your ... Nokia phone uh hundred million dollars in bonds you own ongoing dollars of bonds but that was what ... he had Jackie know it's it's the shoes are really important point that people who treat these things know ... been meeting people who are new to them don't which is that the price of the funds ... will cut it in the swing ... you know ... above and below the actual underlying holdings value depending on ... market sentiments of everyone is freaked out when they aren't bonds right now ... it's can be ironing ... that does this apply to mutual funds are on the ETF ... only only the exchange traded fund that the Mitchell funds you're entitled ... to redeem their shares at what's called them that ... this net asset value ... the difference that the ETF structure is that if you sell ... in a selloff in a panic ... you get penalize for that ... doesn't she not spoken Jack Bogle a Morningstar often you are both intended ... and as the TT apps that I know it's a bit of a bugaboo for him and he said it was certainly the greatest marketing inventions twenty for Sentry investing ... but not to say the best investment and is a good example of what that people would understand that deatails cuz it's important ... to target goal bonds a quick and on equity is what our mutual funds that hold stocks what's happening with them in anticipation of that ... Jack I would just to think that the stock market you know ... if funds are really going the selloff which nicer have some doubts there ... on you you think that this would also be bad news for stocks because people been raining ... so heavily on the bond market for years now ... aam ... if you take a hit there ... you you probably don't want one A dial Back Chris generally that would never be a good thing for stocks ... it strikes me however that the risk of surprise money beyond Ben burn Anqi actually soothing the market lvl that I think everyone so on it ... and come now expecting him to just ... maybe have everything down and we might see if not a rally rally in anticipation as the market comes rather than you ... yet here you know you know I'd I'd insert certainly think that you get that sense ... last week there's a story in the in the Wall Street Journal ... by the resin Fed watcher their John Kell John Kell doesn't wrap ... do you know he seemed to be telegraphing ... if you can read it that way I think you can ... the feeling that that the Fed boss everyone